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Being entrepreneurial and delivering mid-market sized turnover need not be mutually exclusive. Sweden’s Fontana Food has achieved the best of both worlds
When Frixos Papadopoulous arrived in Sweden in 1974 as a refugee following the Turkish invasion of Cyprus, the entrepreneur spotted a gap in the country’s unadventurous food market. He started selling exotic Cypriot fruit juices to small retailers out of his car boot, and by 1978 Fontana Food was born.
Today, the company employs 34 staff, has a £25 million turnover and supplies around 200 product lines, including a variety of Greek cheeses such as feta, olive oil and olives. Despite this growth, Fontana Food has retained its start-up spirit. Employees have a shared passion for what the company does, ideas flow freely and the good ones are followed up and acted upon quickly.
So what can other growing mid-market businesses that want to remain entrepreneurial learn from Fontana Food’s experience? Here are their five top tips:
1) Build entrepreneurship into your DNA
Fontana Food is a typical example of a start-up that has successfully harnessed its entrepreneurial potential as it has progressed towards becoming a mid-sized company. Annika Hall, director of business advisory at Grant Thornton Sweden, describes this as a transition from “individual to corporate entrepreneurship”.
Individual entrepreneurs are typically fast, flexible and action-oriented. They are also good at spotting new opportunities, being completely customer driven and making the best of limited resources. Most notably, they value the freedom and control that they gain from working for themselves.
While these characteristics are positive contributors to growth in the start-up phase, they don’t necessarily remain so. Ironically, an entrepreneur’s desire for control can stifle the creativity of like-minded staff within the organisation, which becomes a brake on growth.
Corporate entrepreneurship weaves the positive attributes of individual entrepreneurs into the fabric of an organisation, allowing entrepreneurial behaviour to flourish.
“Corporate entrepreneurship is embedded within the social relationships, structures and processes of a company,” says Hall. “You need to ensure that these things are set up in a way that encourages people to behave as individual entrepreneurs, coming up with ideas and questioning and challenging things. If you don’t enable this then entrepreneurial people within the organisation – intrapreneurs – will leave.”
2) Include everyone
Hall says there are numerous ways to preserve an entrepreneurial culture as you grow. “Create a culture where people are allowed, encouraged and seen to have ideas, and where there is a constant discussion around what you do, how you do things and whether you do them in the best way,” says Hall. “This encourages people to feel that their individual contribution is valued, which means they are more likely to behave in an entrepreneurial way.”
Corina Papadopoulou agrees. As Fontana Food’s communications director, she helps father Frixos run the company alongside her brother, Loizos, who is the CEO. She says the company is “more entrepreneurial than ever”, thanks largely to the strong relationships that her father has encouraged the family to build with customers, suppliers and staff.
“We’re very inclusive,” she explains. “We always ask for and listen to everyone’s opinion, even if they can’t be involved in all the decisions. For example, we always have proper lunch breaks and sit around a table for an hour. You get great inspiration and input by just talking during your lunch break.”
Corina believes the company’s inclusive approach has helped to drive retention too. On average, staff stay with the company for around 10 years but the longest serving employee joined Fontana 26 years ago.
3) Walk the talk
Corporate entrepreneurship can manifest itself in plenty of other ways: reward systems that encourage the sharing of ideas and opinions; promotion on the basis of entrepreneurial behaviour; and the presence of entrepreneurial people at all levels of the organisation. Hall also suggests introducing clear structures and processes so that employees know what to do when they have an idea and actually have the opportunity to try it out.
However, she warns that companies need to “walk the talk” if people are to truly believe that they can behave in an entrepreneurial way. “Don’t encourage people to put their ideas in an ideas box but only ever enact the ideas of a handful of people,” says Hall. “It sends out a contradictory message.”
4) Build a shared vision
Hall recommends that companies define a shared vision or goal to serve as a guiding light for all entrepreneurial activity. Fontana Food’s goal is to become the most well-known Greek food company in northern Europe, delivering the best products to its customers. It’s a goal it wants to achieve through energy, passion, persistence and honesty.
“We’ve grown up with our father’s vision and values, and it would be criminal not to carry on in the same spirit because it’s taken him 40 years to get the company to where it is today,” says Corina. “It’s a huge responsibility to make sure that it always stays that way.”
The company has already learnt the consequences of straying from the founder’s values. Marketing manager Marie Eklund explains: “There was a growth spurt four or five years ago when some wrong [recruitment] decisions were made. I think we’ve realised that the most important thing for the success of Fontana is the people who are in this building. We have to share the same values, which are honesty, passion and having fun. It’s possible to climb the career ladder here but it can’t be your core focus.”
5) Get the balance right
It’s also important, Hall says, to achieve the right degree of corporate entrepreneurship. She describes it as a balance between exploration – allowing people to try out new things – and optimisation – ensuring you deliver what you already do in an efficient and effective way. Fontana Food understands that need for balance. As it becomes bigger it is beginning to put some systems and processes in place, but it is still in pursuit of growth so that infrastructure will be sparing. “We’re still driven by passion, by finding gaps in the market and by solving problems for our customers,” says Eklund. “Processes should help you to do good business; you shouldn’t have processes for processes’ sake.”
For growing companies that achieve corporate entrepreneurship, the prize, says Hall, is sustainability through constant renewal and development. Ask the Papadopoulous family – they should know. Their entrepreneurial outlook has given them a bright and exciting future in which they hope to become leaders in their core product categories, introduce new innovations to the market and eventually achieve Frixos’s dream of becoming northern Europe’s most well-known Greek food company.
To speak to Annika or one of our other advisory specialists about how you can make your growing business more entrepreneurial, visit our advisory page.